I’m looking to replace my current car and I’m looking for local certified pre-owned inventory. I’m finding that many dealerships’ advertised prices already fall within what independent third-party sites, like cars.com or edmunds.com, consider a good deal. For example, I’m looking at one right now which Edmunds puts in their “good deal” range because it’s “$1132 below market.” If I play with their price slider, I find that lowering the price by a mere $441 puts in what they consider the “great deal” range which means “well below market average.” Cars.com also labels this a “good deal.”
Given these tools–and the fact that you can go on the Kelley Blue Book website, plug in a make, model, year, and features list, and get what they consider the fair value–are car dealers actually still attempting to fleece customers by listing cars at thousands of dollars more than what they’d actually be willing to sell them for? I’m just wondering, if the aforementioned listing is already a pretty good deal, whether if I go in there and offer then $3000 less it’s going to reveal that I don’t know what I’m doing.
I’ve found that ALL of those sites are usually full of shit.
My wife and I consistently own 4 vehicles (2 sports cars and 2 vehicles with 4 wheel drive). So we typically buy a new car every 2 years. Every single time, regardless of what make, which dealer, and whether it is in Wisconsin or the Flatlands, I have always negotiated a better deal than any site has suggested.
KBB is full of crap. They give out two of them. One has the prices for the dealer to show you what their used cars are worth. One is for the dealer to show you what your trade in is worth. And they are thousands apart.
Yes, you still need to haggle. Especially avoid Toyota dealers.
Now if you deal with a broker or a place like cars.com, I dont know.
I bought a new car for my youngest in the spring. The price on the dealer’s website was actually OK with me, but it turned out they were way low on my trade-in. I genuinely wanted forget the whole thing, since we were thousands apart and politely started to leave. Although I’m usually good at this, I just didn’t want to spend the time horse-trading. Apparently they interpreted this as a shrewd negotiating move* and immediately met my proposed numbers. So yes, price negotiation is alive and well.
*It wasn’t. I was just tired and wanted to go home.
If you go to the KBB website, they are explicit about this. They will give you three price ranges: trade-in, private party, and dealership. The different prices represent real differences in the market. Dealerships have higher costs to sell a vehicle and better selection. You’ll pay a price premium to them to buy. If you want to do the adverting and sales process yourself, you get to pay yourself some of those costs (and in many cases avoid others, like storage costs, entirely). If you want to sell your used car immediately to someone who will buy it for sure, you get the lower trade-in price.
They aren’t full of crap. They’re documenting reality!
Good question. It’s been over 10 years since I bought a car, but even then, I shopped around by looking online at what cars were available for what prices at dealerships in the area, and got what I thought was a good deal by paying the price advertised online.
It would seem to me that, if dealers are going to advertise/post their prices online, it would behoove them not to artifically inflate them, as that would put them at a disadvantage compared to other dealers who advertised lower prices.
I would start with the basic assumption that some, most, or all of the online sources for vehicle pricing information are either owned, or at least partially funded, by those with an economic interest in the sale of vehicles (ie, dealerships, consortiums, industry lobbying firms) unless proven otherwise.
The Internet hasn’t done much to truly remedy information asymmetry on this one, unfortunately.
You need to understand how KBB works and that it is pro-dealer.
The method I use is to look up the dealer trade-in price on the car I want to buy on KBB then add $2k. It doesn’t always work because you have to be willing to walk away.
If you aren’t ready to walk they’ll talk you into a higher price. If you are willing to walk some of them will let you walk and some will chase you out the door before you drive away. If they do chase you make sure you negotiate the new price before you walk back into the dealership.
It’s still a thing and they will still try to fuck you.
When I go to the dealer, I have already decided exactly what I want. I tell them, “you have one chance and one chance only. Today you will give me your best price for the new car and for the trade in. I will be going to at least two other dealers and the best price wins. I will not come back and negotiate with you. If we don’t come to agreement, we part as friends. If you treat me like an idiot, I will leave you a shitty review on every platform imaginable.”
They do, but that is not how they are used by car dealers, who show you one book “this is all you trade in is worth” and then another “this is how much our used car is worth”.
From DavidNRockies cite above: So whose side are those new-car pricing sites really on?
They deserve praise for the information they provide to help consumers choose vehicles that best fit their needs. And they provide a useful service to shoppers who abhor the negotiating process so much that they’re willing to pay “an average price,” including their “finder’s fee,” to avoid it. But their business models are built to protect dealers’ profitability, not to help you get the best price. Given their industry-dependent relationship, telling you the truth would be financial suicide.
They have nothing to offer knowledgeable consumers, who know the invoice price is a bloated imposter and that the way to get the best price is to make several dealers compete for their business.
Well, sure. But this seems like it falls under caveat emptor. There’s lots of real price data out there. The fact that you can’t get it from the person trying to sell you something isn’t very surprising.
Agreed on your next point that the various car-pricing websites aren’t really aligned with the consumer.
To the OP: negotiation over costs is inherent to any large purchase. New information sources and tactics may shift the balance of power, but it’s never going away. Because as soon as the price to be paid is large enough, the economic surplus involved makes it worth both parties’ time to hash out exactly how that surplus should be split.
When I last bought a new car, I got e-bids for the exact car I wanted from several regional dealerships. The prices varied quite a bit and we went with the lowest. I let them know I was coming with a cashiers check for the exact amount they quoted and to have the car ready. In and out and no haggling. It just so happened that the lowest quote was at the closest dealer that we used for our test drives so I was happy about that.
Note that the OP is “looking for local certified pre-owned inventory.” I assume the answer to the thread title’s question, or at least some of the details, may depend on whether one is shopping for a new or used car.
Definitely. My reply was based off hajarios new car buying strategy. Pre-owned would be a totally different beast and one I don’t have much experience I have. My current car, which was purchased new, has been my only non-POS (think Adam Sandler) car I’ve owned in my entire life. The most I paid for previous vehicles was less than $5K, all bought from private sellers.
My current vehicle, which is now almost 9 years old, is still nicer than any previous POS vehicle I’ve owned. I drive so little (currently at 75K miles) I think I have at least 6-10 years left with it. I’m probably going to base that on how many more sets of tires will I buy for it.
Yes. The information in the article posted by DavidNRockies about how car companies have inflated the invoice price to make it look like you’re getting a deal even though that’s not what the dealership is actually paying for the car is very interesting, but that’s not so relevant in my case since I’m not shopping for a new car. Another thing that makes some of the advice less than relevant is that I’m pretty picky about what I want: a small luxury SUV with a head up display in a color other than black, white, gray, or silver. (It’s a huge pet peeve of mine that automakers have all but stopped making cars in actual colors and that 90% of them are so plain these days. I had to go out of state to get so much as a blue car when I bought my current car.) I’m lucky if there’s more than one vehicle meeting that description on a lot at any of the dealerships in my greater metropolitan area at any time. (There might be a handful if I were willing to go with one of the aftorementioned plain colors.) So I’m not really in a position to call up three different dealerships, tell them exactly what I want, then play all of their offers against each other. All I can do is wait for the vehicle I want to actually pop up somewhere, then try to talk them down in price as much as I can. I know beggars can’t be choosers. I’m just one of those “milquetoasts” who hates negotiating because I really have no idea what the car is actually worth.
My good friend works at a local bank and is head of the consumer finance department, which mainly involves approving loans for auto purchases. Over the past 15 years, I’ve bought two new cars and one pre-owned (after one of the new cars got t-boned), and each time I’ve sent him the VIN, along with the mileage for the used car. He has sent me back a figure and has told me “Don’t pay any more than this.”; that figure is always significantly lower than the advertised price. Each time I’ve shown the dealer that figure, and I’ve told them that it’s take it or leave it. They have taken it each time, although not without some bellyaching.
I did a similar thing some decades back. We told the salesman where we wanted the number. He came back with a significantly higher number. I stood up and said, “We can’t do that.” and headed towards the door. And the number came back in line. I wasn’t playing games - I was dealing with our budget and I wasn’t going to stretch it for that guy. It was a valuable lesson for me!
Frankly, I’m a little skeptical. That clark.com website itself has the look and feel of someone trying to sell you something.
Furthermore, it has guides on buying a new car and buying a used car which recommend using similar sites like Carmax, Autotrader, CarGurus, and CarsDirect.
Furthermore, I went over to Edmunds to see what the ads were like. I saw ads from State Farm, Geico, Ford, and Kia. The Ford and Kia ads were for Ford and Kia in general, and clicking on them took you to the main consumer section of their American website, not a local dealer. And… I saw the exact same Ford ad on clark.com!
